1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Burka [1]
3 years ago
9

Which of the following statements is CORRECT? a. During a period when a company is undergoing a change such as increasing its us

e of leverage or taking on riskier projects, the calculated historical beta may be drastically different from the beta that will exist in the future. b. If a company with a high beta merges with a low-beta company, the best estimate of the new merged company's beta is 1.0. c. If a newly issued stock does not have a past history that can be used for calculating beta, then we should always estimate that its beta will turn out to be 1.0. This is especially true if the company finances with more debt than the average firm. d. Logically, it is easier to estimate the betas associated with capital budgeting projects than the betas associated with stocks, especially if the projects are closely associated with research and development activities. e. The beta of an "average stock," which is also "the market beta," can change over time, sometimes drastically.
Business
1 answer:
hram777 [196]3 years ago
7 0

Answer:A. During a period when a company is undergoing a change such as increasing its use of leverage or taking on riskier projects, the calculated historical beta may be drastically different from the beta that will exist in the future.

Explanation: Leverage is a term used in Financial investment to mean the use of various borrowing options by an organisation in order to improve its potential to make profit or its potential to be Competitive.

Risky projects are projects known to high a high chances of loss,this type of projects can lead to severe consequence for business Organisations.

the beta of an investment is a measure of the risk which is caused by the exposure of an investment to general market changes as opposed to internal factors that can have severe negative impact on an investment.

You might be interested in
Rudolf, a Polish manager in a company based in China, is admired by his colleagues for the way he interacts with people, his con
zimovet [89]

Answer: Respect

Explanation:

Respect is something that human beings are taught from birth. It is an attitude and way of being that someone has where they show appreciation for others. A person who has respect treats everyone equally, does not seek humiliation but good treatment.

Respect leads to good integration, where regardless of the differences that a person may have, they can live harmoniously since there is a good deal above all else. Respect allows people to live quietly, where good treatment is one of its main characteristics.

In Rudolf's case, he is a person who maintains respect. He is someone who respects the culture of others and treats everyone equally. He does not seek conflict but a healthy environment where everyone can work harmoniously and this type of behavior lead others to have a good concept and admiration for it.

3 0
2 years ago
Suppose a riskless project requires an initial investment of $10 and will generate a one-time cash inflow of $30 two years later
Evgesh-ka [11]

Answer:

D. The payback period is less than 2 years.

Explanation:

Discount rate                 5%  

                                        0      1          2

intital investment        -10  

cash flow                       0        30

Total cash flow         -10      0        30

NPV                        17.21  

IRR                                 73%  

Therefore, The NPV is 17.21 and is positive, the statement is True.

IRR > 50%, Therefore the statement made is True

Accounting rate of return = {[(30 - 10)/10]^(1/2)} - 1

                                           = 41% > 0

Therefore, The statement made is true.

Payback period = 2 years, Therefore the statement made is NOT true.

7 0
3 years ago
Congress wishes to impose regulations on the insurance industry. What test would the United State Supreme Court use to determine
abruzzese [7]

Answer:

Three part test.

The outcome: if the three requirements are not met, then there is not point the Government should interfere.

At the end, the law will be held.

Explanation:

In some cases, the courts are allowed to protect individual, company or business organization from Government interrupting with these individuals or business organization "fundamental right" and this is the "substantive due process rights " of insurance companies as mentioned in the question above.

The test that the United State Supreme Court can use to determine whether the regulations they want to enact would violate the substantive due process rights of insurance companies is what is known as the THREE PARR TEST.

THE THREE PART TEST has its root from cases such as that of Pasgraf V Long Island Railroad co. The three part test involves three main subjects and they are;

=> foreseeability: are the policies in which insurance companies work going to affect the consumers in the future?

=> proximity: what kind of relationship do the insurance companies have with there consumers?

=> fairness: are these policies just and fair?

CONCLUSION: if the three requirements are not met, then there is not point the Government should interfere.

6 0
3 years ago
3. Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification
Mazyrski [523]

<u><em>Explanation</em></u>:

<u>(a) FIFO</u>

In using this method we calculate cost based on the price of the earliest (first) purchased inventory date.

(b) LIFO

Here we calculate cost by using the price of the most recent (last) purchased inventory date. eg for inventory cost calulations for March 9 we use the price value of March 29

(c) weighted average

This meeting uses the average cost of the entire inventory in the month. Calculated by dividing total cost by today inventory.

(d) specific identification.

Here cost are just assigned to each individual item or batch of items in the period.

6 0
3 years ago
You charge a price of $5 for a pair of earrings and produce 100 pairs. At this price, consumers demand 200 pairs of earrings. Th
Dima020 [189]
Raise the price of your earrings
5 0
3 years ago
Read 2 more answers
Other questions:
  • Country X has currency C1 and Country Y has currency C2. The nominal exchange rate C2/C1 and GDP deflator P for Country X and P*
    12·1 answer
  • If an expansionary policy pushes output beyond the full employment level of gdp:
    5·1 answer
  • Quinn has capacity to make 950,000 zippers per year, but due to a soft market, only plans to produce and sell 620,000 zippers ne
    6·1 answer
  • You are considering a project with an initial cost of $4,300. What is the payback period for this project if the cash inflows ar
    6·1 answer
  • Last year Susana's mother, Maria, suffered from a heart attack and is no longer capable of caring for herself. Maria made arrang
    8·1 answer
  • Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area
    14·1 answer
  • Explain why zoning laws, which allow certain land uses only in specific locations, might be justified in dealing with a problem
    13·1 answer
  • Teresa wants to take her firm internationally but is concerned with the ________, which refers to the possibility of higher cost
    9·1 answer
  • a may be dfined as decriptio nof a proposed copmany that explains how it epxects to achieve its marketing
    6·1 answer
  • I’m ancient times, memory was a vital component in public speaking because?
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!